Pros/Cons of ARRL as 501(c)3 vs. 501(c)4 Organization?

As I mentioned in my previous article asking about the Radio Amateur's Handbook, I try to talk up the ARRL and ARRL publications to other friends and colleagues, some of whom may or may not be radio amateurs. One common question that I hear back from those who are savvy about how government works, and how to effectively petition/lobby it, is why doesn't the League organize a 501(c)4 organization in addition to the existing 501(c)3? I know that this was addressed in a past article in QST (maybe 20 or more years ago). Some of the answers that I can recall that were in the article included things like:

- A 501(c)4 organization would have unacceptable restrictions, including the inability to receive Federal grants and tax-exempt donations.

- The only significant limitation on a 501(c)3 organization is that it cannot support or oppose anyone running for public office. Otherwise, the ARRL is free to talk to "anyone, anytime" through its registered government relations representatives ("lobbyists" like Paul Rinaldo, W4RI, et al).

Some of the answers that I thought of included:

- The ARRL does not have the membership base of something like the National Rifle Association (about 12:1 difference, actually). To organize a 501(c)4 would require a lot more money, and from a much smaller membership base. The economies of scale are just not there.

- Getting too deep into the "dirty" business of government lobbying might strike the ARRL and its members as unseemly, possibly backfire as elected officials start to see us as "yet another" lobbying/campainging group rather than as a public resource.

I directed these questions to my Division Director, Cliff Ahrens K0CA, some time back (about 2008). He replied, saying that they were good questions and that he was curious about the answers himself, so directed them to those at HQ involved in government relations. I didn't hear anything back further about this.

Would this be a good topic to revisit in a future article in QST, or maybe reprint the previous article, or at least add the answers to an FAQ section about the ARRL on its Web Site?

Paul, the short answer to your question is the following, taken from the IRS website:

Frequently Asked Questions About the Ban on Political Campaign Intervention by 501(c)(3) Organizations: Contributions to Political Organizations

May a section 501(c)(3) organization make a contribution to a political organization described in section 527 (such as a candidate committee, political party committee or political action committee (PAC))?

No, a section 501(c)(3) organization may not make a contribution to a political organization described in section 527 (such as a candidate committee, political party committee or political action committee (PAC)). Nor may such an organization establish and maintain a separate segregated fund under section 527.

Thank you for your reply. You're answer is certainly correct, but maybe I didn't phrase my questions clearly enough as to what I was asking. Specifically, has the ARRL considered the strategy of forming both 501(c)3 and 501(c)4 organizations, much like how the NRA is both the NRA (501(c)4) and the NRA Foundation (501(c)3)? I suspect that the answers are what I enumerated above. Specifically, that we can't bring enough money to the table to make a 501(c)4 cost-effective relative to its limitations, and the few important restrictions on 501(c)3 organizations, including restrictions against certain types of campaigning and political contributions, really don't impact us in terms of our influence with elected officials (who we can usually talk to "anywhere, anytime" about issues that affect us).

Since this seems to be a question and concern that comes up occasionally, but often enough to be significant, with other people I talk to about the ARRL, both members and non-members, I wonder if a discussion of these issues that occurred in a QST article I seem to recall from about 20 years back, would bear repeating, either as an article, or an FAQ item on the ARRL web site.

Paul, while a 501(c)(4) can form a 501(c)(3) organization for tax-exempt purposes it can't be done the other way around -- that is, as a 501(c)(3) we are not permitted to play any role in the formation of a 501(c)(4). That said, I agree with you that the restrictions on what we can do as a 501(c)(3) are not significant since we are not involved in partisan issues anyway. We have ample access to the legislative process. -- 73, Dave K1ZZ

Your latest clarification helped illuminate for me the somewhat technical answer from the IRS above. If I were to restate it more simply, there is no apparent legal path to make a 501(c)(4) organization using any of the assets, leadership, or name of a 501(c)(3) organization, even if we had wanted to, and it seems that it's not a useful path for us, anyway. I'll be sure to pass this answer along to colleagues if the subject comes up again.